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Highlights of the budget compromise

The top politicians who emerged from a long night of budget talks wearily starting summing up key settlements at a press conference Friday morning. As expected, the government politicians claimed that the main thrust of the budget “stood firmly,” while the government’s two small support parties in parliament claimed they’d been able influence government spending in several areas.

Weary politicians stopped quarreling and formed a united front in presenting the state budget compromise on Friday. PHOTO: FRP/Bjørn Inge Bergestuen
Weary politicians stopped quarreling and formed a united front in presenting the state budget compromise on Friday. From left: Trond Helleland of the Conservatives, Harald Tom Nesvik of the Progress Party, Knut Arild Hareide of the Christian Democrats and Trine Skei Grande of the Liberals. PHOTO: FRP/Bjørn Inge Bergestuen

“The Christian Democrats and the Liberals have had an effect on the budget,” conceded Trond Helleland, main negotiator for the ruling Conservative Party. He added, though, that “this is a budget where everyone has given and everyone has received.” Tom Nesvik of the Conservatives’ coalition partner, the Progress Party, said that all four parties “had left their footprints on the budget.”

They all ended up signing a budget agreement that ensures its passage in Parliament. Among its key concessions, as compiled by various Norwegian media:

*** The Progress Party prevailed in its resistance to raising fuel taxes, forcing the Liberals to withdraw their proposal to boost the already high taxes to further discourage driving. The move marks the first time ever that fuel taxes will not be raised in a state budget.

*** NRK will be able to raise its license fee, though, and the government was forced to abandon efforts to cut NOK 50 million in financial support earmarked for struggling media outlets.

*** Norway will take in 500 more refugees, mostly from Syria, than the government had budgeted for.

*** The government will boost funding for day care centers to accommodate 2,600 more children.

*** The two coalition parties and their two support parties “met half-way” on reductions in Norway’s controversial tax on net worth, known as formueskatt (fortune tax). The standard exemption will rise from NOK 1 million to NOK 1.2 million and the tax rate will fall from 1 percent of taxable net worth to 0.85 percent, instead of the 0.75 percent initially proposed by the government.

*** The Christian Democrats forced the government to withdraw its unpopular and much-criticized proposal to reduce welfare payments to children whose parents are on disability.

*** Norway’s “tax class 2” will remain in place, providing some tax relief to couples where only one of the spouses works full time.

*** The standard tax deduction for all Norwegians will be raised, meaning that more salaried workers will receive some tax relief.

*** The exemption from paying customs duty on imported goods will be raised from NOK 200 to NOK 350 instead of the NOK 500 proposed by the government. Retailers had complained mightily that the NOK 500 exemption would hurt their business because more Norwegians would shop online from abroad.

*** In return for giving up its demand for higher fuel taxes, more money will be allocated to environmental measures promoted by the Liberals. The party sought another NOK 13 billion for “green” programs, such as renewable energy projects, but got NOK 2.7 billion. Among them, lower taxes on hybrid cars.

After weeks of quarreling and hurling criticism at one another, the politicians made efforts on Friday to praise each other and their budget agreement. Knut Arild Hareide, leader of the Christian Democrats, claimed to finally be satisfied: “The budget has become even more social, greener and more family-family.” Berglund



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